Differences in HMOs and PPOs

It is important to have medical insurance in case you are ever injured or involved in a medical emergency. However, when trying to choose the coverage type that best suits your needs, the variety of medical insurance options can be overwhelming. Two common types of medical insurance plans are the HMO and the PPO. If you are attempting to choose a new insurance plan, it is important to understand the difference between these two options, as well as the advantages and disadvantages of each.

Health Maintenance Organizations (HMOs)

Health maintenance organizations (HMOs) are popular health insurance options because they generally cost less than other types of plans. Most HMOs include low or even free co-payments on doctor’s visits, making them a good choice for those who cannot pay many additional funds out-of-pocket. However, many restrictions exist on HMO health care plans and patients sometimes face problems getting the health care assistance they need in a timely manner.

With HMOs, healthcare organizations hold contracts with insurance providers so that they may provide services at a reduced rate. Those insured under these plans must choose a primary care provider covered under this agreement and must visit this physician for all healthcare needs. Before visiting a specialist, patients must obtain a referral from their primary care physician.

Preferred Provider Organizations (PPOs)

Preferred Provider Organizations (PPOs) offer far fewer restrictions than HMOs. Many patients choose PPOs for the flexibility and the extended control the plans offer patients over their own health care decisions. Patients may visit any doctor within the covered network, with no need to see a primary care physician.

Additionally, a patient may visit an out-of-network physician and the cost will still be partially covered by insurance. If a patient wishes to visit a specialist, he or she is not obligated to obtain a referral from another doctor. The downside to PPOs is that they cost more than other types of health care plans. However, many patients still choose PPOs for their added convenience and freedom.

Contact Us

For more information about HMOs, PPOs, or other California health insurance plans, contact Catherine Michaels Insurance Services today at 888-875-9888.